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Coffee City

Melissa Allison follows the world's biggest coffee-shop chain and other Seattle caffeine purveyors.

May 12, 2009 at 6:55 PM

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Blogger: Starbucks campaign stifles McDonald's innovation

Posted by Melissa Allison

Mitch Goldstone, the CEO of ScanMyPhotos.com, is so concerned about Starbucks' recent ad campaign that he interrupted blogging about the world of photo scanning to heap blame on the coffee chain for indirectly going after McDonald's newish espresso effort.

The Seattle coffee giant is stifling innovation, Goldstone writes, and conveniently forgetting that it went after McDonald's breakfast sandwich business a few years ago. He quotes himself saying that Starbucks' campaign "is stifling competition and thwarting innovation and entrepreneurial inventiveness."

You know Wall Street wouldn't like that, after spending the better part of a decade haranguing McDonald's to innovate.

Fortunately for the attacked burger chain, its share of the coffee pie is growing, according to consumer and industry data from The NPD Group in Illinois, which has tracked the food service industry since the early 1980s.

The hamburger category (dominant player: McDonald's) served 5 percent more coffees during the first quarter, while the gourmet coffee and tea category (dominant player: Starbucks) served 7 percent fewer. The dooughnut category (top banana: Dunkin' Donuts) got the biggest boost, at 13 percent.

The coffeehouses still owned the market with 468 million coffees served, compared with 246 million for the burger folks and 315 million for the doughnut slingers.

Copyright © 2009 The Seattle Times Company

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